This topic contains 14 replies, has 6 voices, and was last updated by Anonymous 6 years, 7 months ago.
- April 30, 2011 at 11:57 pm #419594
You should be good to go if you have a commitment letter and a Clear to Close
- May 1, 2011 at 12:15 am #419595
Actually, it can be denied…unfortunately. Basically, it can be denied up to three days after you sign the closing papers, especially if you are going directly to a bank. The bank can make up any kind of excuse to turn it down. Your best protection is to make sure you applied with a mortgage broker (someone who deals with lots of lending companies), because if the loan gets dropped last minute, the broker can slide your application into another lender asap. It may take a week or two longer to close, but at least it can still get funded.
If this does happen to you, just make sure you look at the terms closely when you sign. Loans often get changed last minute.
Hope this helps.
- May 1, 2011 at 12:46 am #419596
You actually CAN be denied at the very last moment, but only if you pull something stupid like suddenly running up your credit card debt about $ 10,000 (maybe to buy new furniture for that house). Additionally, were there to be a substantial negative change to your income due to a job loss, the same would apply.
Generally speaking however, if nothing of substance changes on your credit report and verified incomes after you receive a commitment, you should be fine. Just staple your credit cards to the floor and don’t remove them until AFTER you close.
Enjoy the new digs !
- May 1, 2011 at 1:05 am #419597
what ERICA & ACER say are correct…but also keep this in mind….this is why closings are soooo stressful!..people stress over evry little minute of closing…..
take a deep breath (have a glass of wine)…chances are you’ll be ok…but if something happens you can always rectify and restart the escrow/closing process.
- May 1, 2011 at 2:03 am #419598
It sounds as if you don’t have any confidence or trust in your mortgage broker. I would call and ask them point blank if there are any issues. You can also ask them specifically what else needs to be done and what status the lender has assigned to the loan. Above was mentioned clear to close. Mainly an inside the ropes term, but basically the big green light mortgage brokers are working to get. If you have that, bar any major changes to your personal situation, you should be ok.
As my Broker/Owner/Realtor friend likes to say, you can count on the loan being ok only after you have moved in to house 🙂
- May 1, 2011 at 2:28 am #419599
1st – CONGRATULATIONS = )
2nd- Unfortunalty, even if the underwriter gives the files a clc (clear to close), they can still deny it, but it better be for a gooood reason. Otherwise, if you have reserves, good credit, appraisal is ok, I dont see why you should have a problem.
I recommend to call your loan officer or broker and ask for an update on the file since its still a month to go.
I had 1 file denied at settlement, but remember, if everything looks good at your end, dont worry!
Wish you the best and hope evrything goes well = )
- May 1, 2011 at 3:08 am #419600
Pre approvals and commitment letters are not worth the paper they are printed on generally speaking. They always contain verbage stating the outstanding conditions and should any of those conditions not be met to the satisfaction of the underwriter- the file can be denied.
The clear to close the others have mentioned is the thing you want to ask about. Until you have met all the outstanding conditions on your loan- that CTC is not issued. Call your loan officer and simply ask them “Do we have a clear to close on our loan?” If the answer is anything but yes, ask exactly what is needed in order to get that CTC and quickly provide what they need.
You might want to go over the terms of the loan again with the loan officer to make sure it is the same as when you started as things can change- rate, term, loan product, etc. Go over the details with them now so you don’t have any surprises at the closing table when you feel like you are obligated to sign the paperwork even though it is not what you originally wanted.
Good luck to you and congratulations on your first home!
- May 1, 2011 at 3:16 am #419601
If you both lost your jobs the day before closing, yes, you could be declined. Or if you go buy yourself an Escalade and screw up your debt ratios, that’d be another way to lose your approval.
But if you have a good broker, your commitment letter should have real meaning.
If you’ve already provided all your income and asset documents, they’ve run your credit, etc…, you should be just fine.
- May 4, 2011 at 6:17 am #201130
can this hurt me in any way? I just bought my first house. I found my mortgage company, Westar, online through Lendingtree.com. I was pretty happy with them. My first mortgage payment was due 1/1/10, but just to be on the safe side, I set up online bill pay through Bank of America to go out last week, and it cleared my checking account. When I logged into my Bank of America online account today, there was my mortgage showing up with my Bank of America accounts like checking, saving, and credit cards. My statement was on there and it didn’t show the payment I had made to Westar. I chatted with a representative, who said yes, the check cleared, but Bank of America is my servicer, not Westar. I called Westar and they confirmed that they sold my loan to Bank of America. This is the first I heard of it. Westar says they sent me a transfer letter, but I never received it. My rate seems to be the same based on what it says on the Bank of America web site, but I am blocked from accessing my loan documents while they do “research.” I am wondering if there’s anything I need to look out for. I have heard horror stories of people’s loans being sold, but usually those are ARM, not FHA 30 year fixed. Thanks!
David Z: I did not receive a letter from Westar or Bank of America. That’s the problem. I did not know about this until I logged into my Bank of America account this morning. Not the best way to find out.
- May 5, 2011 at 12:06 am #258267
No, there should be no issues. It’s done all the time. Each lender sells packages of loans to the secondary market to gain cash to lend to others.
- May 5, 2011 at 2:39 am #258447
Happens al the time. YOu’re fine. part of a financial transaction between banks; your rate and term are set, even if you are sending your payment to a different place
- May 6, 2011 at 11:38 pm #263890
Your loan is a commodity that is sold like anything else of value. There should be no substantive changes in your mortgage agreement. There may be minor changes that have to do with administration and the way that Bank of America handles these accounts. Keep on top of things to be sure that you are credited for that first payment.
This is very common and normal.
- May 8, 2011 at 6:01 am #266384
99.9% of loans are sold. This is very common.
you received a letter indicating this. It gives you the date at which payments should be sent to BOA. Prior to this date payments should go to Westar. They will get it figured out.
- May 8, 2011 at 4:18 pm #267947
This is quite common and has no effect on you. My mortgage was sold 6 times in 15 yrs.
- December 11, 2012 at 6:52 pm #419602
If you are already approved and cleared by underwriting and the mortgage insurance company denies insurance can you try another mortgage insurance company or is the deal dead?
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